Construction costs in London set to rise 2.8% in 2018 compared to 3.9% in 2017
Growth in London鈥檚 construction costs are expected to ease this year, as the industry maintains its watch on the terms of Brexit, according to Turner & Townsend.
Costs in the capital are set to rise 2.8% in 2018 compared to 3.9% in 2017, according to the consultant鈥檚 International Construction Market Survey 2018.
Labour costs across the UK have risen by 3.1%, with London being the most expensive place to secure workers, with the average hourly rate now sitting at 拢34.
Steve McGuckin, global head of client programmes at Turner & Townsend, said Brexit was responsible for the waning cost increase.
He said: 鈥淭here is a confidence issue in London to do with Brexit. Output has reduced in the past year and there is a view it will reduce a bit again this coming year.
鈥淎s long as we keep steady as we move through Brexit in the next few years it will be fine.鈥�
While construction cost growth is expected to ease in London, it is still 27.7% more expensive to build in the capital than the UK average.
McGuckin said inflation in London鈥檚 commercial sector was likely to outstrip the rest of the sector (2.8%) with cost increases expected to be between 鈥�3% and 4% in the next year or so鈥�.
McGuckin highlighted skills as a key issue for the market moving forward: 鈥淲e need to adopt digital tools, modern manufacturing methods and automation if we are to ease the pressure on resources and help attract new talent to ou